Toyota pickup plant feels the squeeze

SAN ANTONIO — At Toyota’s busy pickup plant here, workers can install a sunroof only on every third truck on the line. Any more would add too many seconds to the build time — seconds that Toyota can’t afford to waste.

Already the plant is pumping out “north of 250,000” trucks a year, said David Crouch, vice president, administration and production control, at the facility, which builds the Tacoma midsize and Tundra full-size pickups on the same line. That’s thanks to an alternative work schedule that includes a Saturday shift and allows the plant to bust its regular-time capacity of 200,000 vehicles a year.

And Toyota needs every last unit of both trucks. Inventories of the Tacoma have long been exceptionally tight, as Toyota all but owned the midsize pickup segment for several years. But with strong new entrants from General Motors and the return of Honda’s Ridgeline, a supply shortage not only makes dealers and customers unhappy but also creates an opportunity for the competition to vie for consumers’ loyalty.

“Obviously, one of the biggest challenges that we have for Tundra and Tacoma is we’re capacity-limited,” Crouch said. If dealers had free rein to order more vehicles, “we could sell a lot more trucks right now.” 

GM has had to do similar gymnastics to satisfy surging demand for its midsize pickups, the Chevy Colorado and GMC Canyon — upgrading the line in Wentzville, Mo., to speed it up, restructuring work shifts to cut down on breaks and offloading some van production to another site.

Toyota’s other Tacoma plant, in Baja California, Mexico, has gone to three shifts to keep up with demand, something extraordinary for Toyota globally, executives say.

To squeeze every last truck out of its only U.S. pickup plant, Toyota has incrementally reduced the time it takes from one unit to the next to roll off the line — or “takt time” — to 60 seconds from 65 seconds just a few years ago, Crouch said.

Any more time savings would require significant investments in equipment improvements by Toyota and its coterie of on-site suppliers. Barring that, the speed knob can be turned only so far, says Mike Sweers, chief engineer for the pickups and vice president of engineering design at Toyota’s technical center in Ann Arbor, Mich.

“One thing that we really emphasize, and the plant management here will emphasize, is that volume is important. Getting as many trucks out is important, but we can’t do it and sacrifice quality,” he said during a visit to the San Antonio plant in late July.

“You have to do your job, and you have to do it right,” he added. “You never pass a defect down to the next guy,” even if it means stopping the line.

Build times for the trucks have been reduced so much that now it’s some of the machinery that can’t keep up, Sweers said, pointing out a machine that flips truck frames as they go down the line.

“That equipment can’t operate any faster than it is operating,” he said. “So at that point, then it becomes investment, and you have to weigh: ‘If I change that, then what’s the next bottleneck in the plant?’”

Same with the suppliers, 23 of which are housed at Toyota’s industrial park in San Antonio, all with equipment designed for a specific workload.

“We’re all set up to build a certain capacity, and when we start pushing it like we do now — we’re at 123 percent or so capacity — can they handle the additional volume as well?” Sweers said.

One reason Toyota has been able to make the gains it has in San Antonio is that suppliers do much of their production on-site — 73 percent by cubic volume for the Tundra and 51 percent for the Tacoma, Crouch said.

The seat supplier, for example, produces the seats in sync with the trucks and sends them by conveyer belt to the Toyota plant next door, where they are delivered just in time to the line, Sweers said. Other parts produced in sequence include headliners, front and rear bumpers, and instrument panels.

Toyota’s truck plant is unusual in that both the full-size and midsize pickups roll down the same line, at the same time, but on different platforms, Sweers said. The configuration allows Toyota to build 60 percent of one model and 40 percent of the other, but not an equal number of both.

The San Antonio plant certainly has faced greater hardships than sky-high demand. In late 2008, it shut down for three months because of the economic downturn and high gasoline prices to reduce Tundra inventory, Crouch said. (Tacoma production wouldn’t arrive in Texas until 2010.) In 2009, San Antonio was running only one shift, with a factory build time per truck of 65 seconds.